A common question for first home buyers is whether it's better to put extra money onto the mortgage regularly, or save it up and make a lump sum payment when refixing. RNZ money correspondent Susan Edmunds put that question to Jeremy Andrews, mortgage adviser at Key Mortgages in Whangarei, for the answer.
Jeremy's advice is clear: making additional repayments sooner is generally better. Reducing the loan balance faster means less interest accruing over time, and most banks will allow extra repayments up to a certain amount within a fixed term without any penalty. There's also a tax angle worth noting. Holding savings separately while interest accrues on the full mortgage balance means paying tax on the interest earned while the debt remains larger.
Where it gets particularly useful is in the structure. Jeremy Andrews recommends choosing a bank or loan structure that treats extra repayments as a retained buffer sitting against the loan, rather than permanently reducing the limit. That distinction matters. If an unexpected expense comes up, those funds can be accessed again. As Jeremy puts it, that's usually exactly when getting new lending approved would be hardest anyway.
Key Mortgages works with clients across Northland to get this kind of structure right from the start, not just the rate. It's the kind of detail that makes a real difference over a 25 or 30-year mortgage.
Full article here: Is it better to pay lump sums off a home loan, or higher repayments? – RNZ
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RNZ asked Jeremy Andrews of Key Mortgages whether first home buyers are better off making extra regular repayments or saving up a lump sum. Getting it right could save years off your total mortgage.
Key Mortgages advise 1news how homeowners could significantly reduce long-term mortgage interest by making simple repayment adjustments and reviewing loan structure regularly.
Key Mortgages comments with Tony Alexander and TMM Online the prospect of whether rising interest rates and global tensions are prompting a more cautious approach from buyers. Is mortgage demand softening as households take time to reassess affordability and market conditions?
NZ Banks are offering cash incentives to retain existing home loan clients. Jeremy of Key Mortgages summarizes with NZ Herald, whether to switch or stay depends on factors like break fees, equity, and overall costs. We can help and negotiate with your current bank to find which is the smarter move.
Key Mortgages recently joined Ryan Bridge on Newstalk ZB, to discuss the recent jump in mortgage rates and what it means for Kiwi borrowers.
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